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Schuler Homes
earnings jump
76.7 percent

Hawaii's improving real estate
market helps fuel the gain

By Russ Lynch
Star-Bulletin

Strong sales on the mainland and a smaller but healthy increase in its Hawaii business pushed the fourth-quarter profit of Schuler Homes Inc. to $7.6 million, up 76.7 percent from $4.3 million in the year-earlier quarter.

Per-share earnings equaled 37 cents vs. 21 cents a year ago. That exceeded the average estimate of 32.7 cents a share from three Wall Street analysts and even beat the highest estimate of 35 cents. Schuler's Nasdaq-traded stock closed up 56 cents at $6.69 in trading today.

Residential real estate sales in the latest quarter totaled $150.9 million, up 86.8 percent from $80.8 million in the 1998 quarter.

At the end of the year Schuler had a backlog of 974 homes ordered but not delivered, a 43 percent increase from the Dec. 31, 1998 backlog of 681. The value of the homes on order adds up to $208.7 million, compared with $123.9 million backlog at the end of 1998, the company said.

Hawaii's real estate market is showing signs of improvement, said James K. Schuler, chairman, president and chief executive officer. While there was some softening in the Oregon market, the other Western markets are showing strength, he said.

"While we are cognizant of recent events, including interest rate trends, and cautious in light of the potential impacts on our industry, we believe a number of markets provide the company with continued opportunities for expansion," he said.

Schuler said the company owns or controls land for another 100 residential projects, representing more than 16,000 units.

During the latest quarter, Schuler delivered 95 homes in Hawaii, up 8 percent from 88 in the year-earlier quarter. The company ended the year with a backlog of 73 sold but not delivered in Hawaii, up 40 percent from 52 at the end of 1998. Its mainland deliveries in the three months Dec. 31 totaled 642, up 58 percent from 406 in the year-earlier quarter. The mainland backlog on Dec. 31 was 901 homes, up 43 percent from 629 a year earlier. These figures include units that are developed through joint ventures with other companies.

Some of the year-over-year increase in mainland sales was due to business acquisitions.